Former Defense secretary Robert Gates is seen with President Obama. / Pablo Martinez Monsivais, AP

by Tom Vanden Brook, USA TODAY

by Tom Vanden Brook, USA TODAY

Editor's note: A story on military pensions Jan. 8 misstated how they are calculated. Years spent at military academies do not count toward time accumulated for pensions.

WASHINGTON - Top military brass will keep their specially boosted pensions despite the December budget deal that trimmed pension rates for other military retirees, Pentagon officials said Tuesday.

In 2007, Congress passed a Pentagon-sponsored proposal that boosted retirement benefits for three- and four-star admirals and generals, allowing them to make more in retirement than they did on active duty. The Pentagon had requested the change in 2003 to help retain senior officers as the military was fighting wars in Afghanistan and Iraq and wanted to entice officers to remain on active duty.

That means a four-star officer retiring with 40 years of experience would receive a pension of $237,144, according to the Pentagon. Base pay for active-duty top officers is $181,501, according to Navy Lt. Cmdr. Nate Christensen, a Pentagon spokesman. Housing and other allowances can boost their compensation an additional third.

Last month's budget deal reduces cost-of-living adjustments, COLAs, by 1 percentage point a year until retirees reach age 62. At 62, the full COLA will return and pensions will bounce back to their full value. The plan is estimated to save $6 billion.

Currently, after 20 years of service, regardless of age, a military retiree qualifies for a pension amounting to 50% of final pay with an additional 2.5 percentage points for each year of service beyond 20.

But the deal does not affect the 2007 enhancement for top pension, which has allowed pension rates for those officers to spike. Figures for 2011 show that a four-star officer retiring with 38 years' experience received a yearly pension of about $219,600, a jump of $84,000, or 63% beyond what was previously allowed. A three-star officer with 35 years' experience would get about $169,200 a year, up about $39,000, or 30%. Before the law was changed, the typical pension for a retired four-star officer was $134,400.

A few officers top 40 years of service in part because the years spent at military academies is counted toward their pension. In 2011, the Pentagon noted that the highest pension, $272,892, was paid to a retired four-star officer with 43 years of service.

Since 2011, however, Pentagon officials have acknowledged that the military is top heavy with brass and senior officials. Then-Defense secretary Robert Gates announced a plan to eliminate positions for 102 generals and admirals. Since then 70 have been cut, others will leave when their combat assignments end and some jobs have been re-assigned to lower ranks, according to the Pentagon.

Reasons for keeping pensions high for top brass is diminishing, said Loren Thompson, a military analyst at the Lexington Institute, and a defense industry consultant.

"Elevating pension benefits to retain generals in wartime might make sense, but the next time we go to war most of the senior officers in the force today will be retired," Thompson said.

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